Prime Healthcare Services - Montclair, LLC v. Sylvia Mathews Burwell

Filing 29

MINUTES (IN CHAMBERS) by Judge Christina A. Snyder: Defendant Thomas E. Price's Motion to Stay 13 is DENIED without prejudice. Court Reporter: Not Present. (gk)

UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES – GENERAL
Case No.

2:17-cv-00750-CAS(MRWx)

Title

PRIME HEALTHCARE SERVICES-MONTCLAIR, LLC ET AL v.
SYLVIA MATHEWS BURWELL

Present: The Honorable

Date

‘O’
June 27, 2017

CHRISTINA A. SNYDER

Catherine Jeang

Not Present

N/A

Deputy Clerk

Court Reporter / Recorder

Tape No.

Attorneys Present for Plaintiffs:

Attorneys Present for Defendants:

Not Present

Not Present

Proceedings:

(IN CHAMBERS) – DEFENDANT THOMAS E. PRICE’S
MOTION TO STAY (Dkt. 13, filed May 8, 2017)

The Court finds these motions appropriate for decision without oral argument. See
Fed. R. Civ. P. 78; C.D. Cal. L.R. 7-15. Accordingly, the hearing date of July 3, 2017 is
vacated, and the matters are hereby taken under submission.
I.

INTRODUCTION & BACKGROUND

On January 30, 2017, plaintiff Prime Healthcare Services-Montclair, LLC brought
the instant action against Silvia Mathews Burwell, in her official capacity as Secretary of
the U.S. Department of Health and Human Services (“HHS”). Dkt. 1. On May 25, 2017,
plaintiff filed a first amended complaint naming Thomas E. Price, the current HHS
Secretary, as defendant. Dkt. 15 (“FAC”). On May 8, 2017, defendant filed the instant
Motion to Stay. Dkt. 13 (“MTS”). On June 12, 2017, plaintiff filed an opposition to the
motion. Dkt. 25.
Prime Healthcare Services, Inc. operates plaintiff and related entities in California
(collectively, the “Prime Hospitals”). Plaintiff alleges that on November 18, 2010, a
Medicare beneficiary, B.E., complained of chest pain and was admitted to Montclair
Hospital Medical Care. FAC ¶ 30. Plaintiff alleges that because of B.E.’s symptoms and
medical history, the treating physician determined that inpatient admission was
necessary. Id. ¶ 32. A Medicare Administrative Contractor (“MAC”)—which generally
makes payments for proper claims for reimbursement—challenged the reasonableness of
B.E.’s medical services. Id. ¶¶ 8–9. An Administrative Law Judge (“ALJ”) upheld the
CV-750 (06/17)

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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES – GENERAL
Date

‘O’

Case No.

2:17-cv-00750-CAS(MRWx)

June 27, 2017

Title

PRIME HEALTHCARE SERVICES-MONTCLAIR, LLC ET AL v.
SYLVIA MATHEWS BURWELL

ruling of the MAC, and the Medicare Appeals Counsel failed to issue a ruling in the
statutory time provided. Id. ¶10. Plaintiff seeks review of the ALJ determination that
plaintiff was overpaid for B.E.’s medical services by $3,918.27. Id. ¶¶ 20–25.
II.

LEGAL STANDARD

A district court has discretionary power to stay proceedings in its own court. See
Landis v. North American Co., 299 U.S. 248, 254 (1936). Accordingly, the court “may,
with propriety, find it is efficient for its own docket and the fairest course for the parties
to enter a stay of an action before it, pending resolution of independent proceedings
which bear upon the case.” Leyva v. Certified Grocers of Cal. Ltd., 593 F.2d 857, 863
(9th Cir. 1979). In exercising its discretion in determining whether to grant a stay, a
court must weigh the competing interests of the various parties that may be affected by
the decision to grant or refuse to grant the stay. Lockyer v. Mirant Corp., 398 F.2d 1098,
1110 (9th Cir. 2005). Specifically, the court must consider: (1) the possible damage or
harm that may result from granting the stay; (2) the hardship or inequity that a party may
suffer in being required to go forward with the case; and (3) “the orderly course of justice
measured in terms of the simplifying or complicating of issues, proof, and questions of
law which could be expected to result from a stay.” Id. In addition, “[a] stay should not
be granted unless it appears likely the other proceedings will be concluded within a
reasonable time in relation to the urgency of the claims presented to the court.” Leyva,
593 F.2d at 864. The proponent of a stay has the burden of proving that a stay is
justified. Clinton v. Jones, 520 U.S. 681, 708 (1997).
III.

DISCUSSION

The instant action is one of 26 similar actions brought in this district by plaintiff
and related entities in California seeking review of similar adverse ALJ rulings
(collectively, the “Judicial Review Actions”).1 The Prime Hospitals have also brought at
1

The 25 additional cases are: Prime Healthcare Services-Sherman Oaks, LLC v.
Price, No. 16-cv-8098-RAO (filed October 31, 2016); Prime Healthcare Services-San
Dimas, LLC v. Price, No. 16-cv-8099-JAK (filed October 31, 2016; Prime Healthcare
Services-San Dimas, LLC v. Price, No. 16-cv-8101-ODW (filed October 31, 2016);
Prime Healthcare-Huntington Beach, LLC v. Price, No. 16-cv-8102-PA (filed October
CV-750 (06/17)

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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES – GENERAL
Date

‘O’

Case No.

2:17-cv-00750-CAS(MRWx)

June 27, 2017

Title

PRIME HEALTHCARE SERVICES-MONTCLAIR, LLC ET AL v.
SYLVIA MATHEWS BURWELL

least six cases in the Eastern District of California and three cases in the Southern District
of California seeking review of ALJ rulings.2

31, 2016); Prime Healthcare Services-San Dimas, LLC v. Price, No. 17-cv-75-DMG
(filed January 5, 2017); Prime Healthcare Services-San Dimas, LLC v. Price, No. 17-cv78-DSF (filed January 5, 2017); Prime Healthcare Services-Sherman Oaks, LLC v. Price,
No. 17-cv-161-DSF (filed on January 9, 2017); Prime Healthcare Services-Sherman
Oaks, LLC v. Price, No. 17-cv-170-JFW (filed on January 9, 2017); Prime Healthcare
Services-Sherman Oaks, LLC v. Price, No. 17-cv-174-VAP (filed on January 9, 2017);
Desert Valley Hospital, LLC v. Price, No. 17-cv-661-DMG (filed January 27, 2017);
Prime Healthcare Services-Montclair, LLC v. Price, No. 17-cv-659-PA (filed January 27,
2017); Prime Healthcare Services-Sherman Oaks, LLC v. Price, No. 17-cv-658-JFW
(filed January 27, 2017); Prime Healthcare Services-Garden Grove, LLC v. Price, No.
17-cv-169-AG (filed January 30, 2017); Prime Healthcare Services-Garden Grove, LLC
v. Price, No. 17-cv-178-AG (filed February 1, 2017); Prime Healthcare Services-Garden
Grove, LLC v. Price, No 17-cv-171-DOC (filed January 30, 2017); Prime Healthcare
Services-Montclair, LLC v. Price, No. 17-cv-173-AB (filed January 31, 2017); Prime
Healthcare Services-Montclair, LLC v. Price, No. 17-cv-174-JFW (filed January 31,
2017); Prime Healthcare Services-La Palma, LLC v. Price, No. 17-cv-802-RGK (filed
February 1, 2017); Prime Healthcare Services-Garden Grove, LLC v. Price, No. 17-cv340-JLS (filed February 24, 2017); Prime Healthcare Services-Garden Grove v. Price,
LLC, No. 17-cv-347-JVS (filed February 24, 2017); Prime Healthcare Services-Sherman
Oaks, LLC v. Price, No. 17-cv-1551-AB (filed February 24, 2017); Prime Healthcare
Services-Garden Grove v. Price, LLC, No. 17-cv-346-JLS (filed February 24, 2017);
Prime Healthcare Services-Encino, LLC v. Price, No. 17-cv-1562-SJP (filed February 27,
2017); Veritas Health Services, Inc., dba Chino Valley Medical Center v. Price, No. 17cv-359-MWF (filed February 24, 2017); Veritas Health Service, Inc., dba Chino Valley
Medical Center v. Price, No. 17-cv-365-FMO (filed February 24, 2017).
2

All six of the Eastern District of California cases were brought by Prime
Healthcare Services-Shasta, LLC. The case numbers are: 17-cv-69, 17-cv-71, 17-cv-72,
17-cv-73, 17-cv-74, and 17-cv-82. The cases in the Southern District of the California
are: Alvarado Hospital, LLC v. Mathews Burwell, 16-cv-2698-DMS-WVG; Alvarado
CV-750 (06/17)

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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES – GENERAL
Date

‘O’

Case No.

2:17-cv-00750-CAS(MRWx)

June 27, 2017

Title

PRIME HEALTHCARE SERVICES-MONTCLAIR, LLC ET AL v.
SYLVIA MATHEWS BURWELL

The Prime Hospitals and the United States are opposing parties in two additional
actions originating in this district. In the first action, U.S. ex rel Bernsten v. Prime
Healthcare Services, Inc., No. 11-cv-08214-PJW (C.D. Cal.), the United States alleges
that the Prime Hospitals submitted Medicare claims for unnecessary inpatient admissions
in violation of the False Claims Act (the “FCA Action”). The FCA Action was filed in
2011, and the United States intervened in June 2016. According to defendant, the
Medicare claim at issue in this action may be within the universe of claims at issue in the
FCA action.
In the second action, Alvarado Hospital, LLC, et al. v. Price, No. 15-cv-06312-R
(C.D. Cal.), the Prime Hospitals allege that an agreement was reached with the
Department of Health and Human Services to permit the Prime Hospitals to participate in
an existing dispute resolution process with respect to claims for reimbursements under
Medicare (the “Settlement Action”). The Prime Hospitals contend that the United States
breached this agreement by refusing to go forward with this dispute resolution process.
The Settlement Action potentially includes the Medicare claim at issue in this action.
The Settlement Action was transferred to the United States Court of Federal Claims, and
the transfer order is currently on appeal in the Federal Circuit. See No. 2016-1356 (Fed.
Cir. 2016).
In the instant motion, defendant seeks to stay this action pending the resolution of
the FCA Action and Settlement Action. MTS at 2. The government has filed similar
motions to stay in each of the other Judicial Review Actions. In nine of those cases,
courts have already ruled on the motions to stay; in each of those nine cases, the
government’s motion to stay has been denied.3

Hospital, LLC v. Mathews Burwell, 16-cv-2699-DMS-WVG; and Prime Healthcare
Paradise Valley, LLC v. Mathews Burwell, 17-cv-54-AJB-MDD.
3

See Prime Healthcare Services-La Palma, No. 17-cv-802-RGK (C.D. Cal. June
12, 2017), dkt. 31; Prime Healthcare Services-San Dimas, 16-cv-8099-JAK-E (C.D. Cal.
June 7, 2017), dkt. 45; Prime Healthcare Services-Sherman Oaks, No. 16-cv-8098-RAO
(C.D. Cal. April 12, 2017), dkt 39; Prime Healthcare Services-Sherman Oaks, No. 17-cv658-JFW (C.D. Cal. June 6, 2017), dkt. 32; Prime Healthcare Services-Montclair, No. 17CV-750 (06/17)

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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
CIVIL MINUTES – GENERAL
Date

‘O’

Case No.

2:17-cv-00750-CAS(MRWx)

June 27, 2017

Title

PRIME HEALTHCARE SERVICES-MONTCLAIR, LLC ET AL v.
SYLVIA MATHEWS BURWELL

Consistent with the decisions in those nine cases, and taking all of the relevant
factors into consideration, the Court concludes that a stay is not warranted. The FCA and
Settlement Actions will not necessarily resolve all of the disputes in this Court’s case and
neither can be expected to be completed in the reasonably near future. In addition, this
case is small is scope and will not require an excessive use of resources by the Court or
the parties.
IV.

CONCLUSION

In accordance with the foregoing, defendant’s motion to stay is DENIED without
prejudice.
IT IS SO ORDERED.
00
Initials of Preparer

00
CMJ

cv-174-JFW (C.D. Cal. June 6, 2017), dkt. 33; Prime Healthcare Services-Sherman Oaks,
No. 17-cv-170-JFW (C.D. Cal. June 6, 2017), dkt. 37; Prime Healthcare Services-San
Dimas, No. 17-cv-78-DSF (C.D. Cal. June 5, 2017), dkt. 25; Prime Healthcare ServicesSherman Oaks, No. 17-cv-161-DSF (C.D. Cal. June 5, 2017), dkt. 33; Prime HealthcareHuntington Beach, No. 16-cv-8102-PA (C.D. Cal. April 12, 2017), dkt 24.
CV-750 (06/17)

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